May 20 – Bloomberg (Susanne Walker Barton): “Treasuries fell, heading for their biggest weekly drop since November, as Federal Reserve officials indicated they’re considering a June interest-rate increase should economic data remain steady… A measure of volatility in the $13.4 trillion Treasury market rose Thursday to the highest level in more than a month. Investors were caught off guard by the hawkish tone of Fed communications, lulled into complacency amid signs of sluggish global economic growth.”I’ll assume the FOMC would prefer to boost rates another 25 bps. They seek to at least appear on a path of “normalization,” dissatisfied with the “one and done” tag. Perhaps they have also become more attentive to the risks associated with prolonged near-zero rates for banks, insurance companies, money funds and the financial industry more generally. Recent economic data would tend to support a more hawkish bent, with a firming of GDP and inflation trajectories. I’ll stick with the theme that currently the key economic dynamic is neither growth or recession, but instead major imbalances and various boom and bust dynamics. Members of the FOMC have voiced unease with market expectations having of late diverged from Fed thinking. The Fed expects a series of rate increases, yet the markets anticipate little movement on rates. The FOMC is “data dependent,” and sees economic fundamentals supporting a move toward a somewhat more normalized rate environment. Markets, on the other hand, see global market fragility and a Federal Reserve held hostage by unstable securities markets (and a “risk off”-induced “tightening of financial conditions”). The markets’ perspective is certainly supported by the Fed’s repeated skittish responses to any evolving “risk off” dynamic.I’ll be surprised if the Fed boosts rates next month. And even after this week’s price adjustment, the markets are still pricing only a 30% probability of a June rate hike. As analysts have pointed out, the Fed meets just days before the big “Brexit” vote in the UK. More important to my analysis, I expect heightened global market fragilities to manifest by June 15th.The EM fragility theme gathers support by the week. Losing 1% Thursday, the MSCI Emerging Markets ETF (EEM) posted a fourth straight weekly decline (down 0.2%). EEM has now dropped 8.7% from April 19th trading highs, in the process giving back all the 2016 advance. Worse yet, bond investors are turning skittish, joining their equities and currencies cohorts. From Reuters (Sujata Rao): “Emerging assets have taken a dive too and BAML said emerging debt funds had seen their first outflows in 13 weeks, shedding $38 million. Emerging equities lost a far bigger $1.6 billion - their third straight week of outflows.”May 20 – Bloomberg (Benjamin Bain): “Mexico’s financial stability is hanging in the balance as the peso’s tumble prompts a dangerous acceleration in outflows from the nation’s bonds, according to BNP Paribas SA. A pullback by foreigners is particularly worrisome for authorities, who have often cited peso bond holdings by international investors as a sign of stability… The extra yield that investors demand to hold Mexican government peso debt rather than U.S. Treasuries has surged this month and the securities have lost 8.8% in dollar terms…”Talk that “Mexico’s financial stability is hanging in the balance” should be taken seriously. Mexico has been an EM investor/speculator darling. It’s worth noting that Mexico’s current account deficit jumped to 2.8% of GDP last year (up from 2014’s 1.9%) to the largest ratio in 17 years. Mexico’s external debt has doubled since 2013 (to $170bn), while the country’s international reserve holdings were little changed ($178bn) over this same period. The Mexican economy is expected to grow only about 2% this year, pressured by low crude prices.The Mexican peso declined 1.0% this week, trading to the lowest level since February. The peso has dropped 7% against the dollar so far this month. Mexican stocks were hit 1.8% on Thursday. Mexico’s 10-year bond yields were up 26 bps over the past month.The South African rand, another fundamentally vulnerable EM currency, dropped 1.5% this week to a two-month low. The Russian ruble sank 2.1%. The Colombian peso fell 2.0% to a one-month low. Brazil’s Bovespa equities index sank 3.7%. Turkish stocks were down 1.9%. When market attention returns to heavy debt loads and latent fragilities, Asia underperforms. The trading week saw Asian currencies under pressure almost across the board. The South Korean won fell 1.6% to a two-month low, while the Indonesian rupiah dropped 2.1% to a three-month low. Currencies in Malaysia, Indonesia, Thailand and Singapore were all down about 1%. China’s yuan slipped 0.3% to a 10-week low versus the dollar. India’s rupee fell 1.0% to a three-month low, as Indian stocks declined 0.7%. Indian stocks now trade about 14% below 2015 highs. Many have viewed India as the new China: years of unlimited potential growth. And integral to the bull case has been hundreds of billions of potential infrastructure spending. With a new pro-reform and pro-business Prime Minister, the sky was to be India’s limit.But India’s economic boom is increasingly vulnerable. The country runs a Current Account Deficit and is susceptible to any deterioration in international investor confidence. The banking sector is suspect. India is also suffering from drought and problematic food inflation. Reserve Bank of India Governor Raghuram Rajan has inspired global confidence, but he is now under attack from politicians who would prefer to scrap the central bank’s inflation mandate.May 20 – Bloomberg (Vrishti Beniwal and Bibhudatta Pradhan): “The Indian lawmaker leading a charge to oust central bank Governor Raghuram Rajan says he’s backed by the ‘overwhelming majority’ of Prime Minister Narendra Modi’s party, raising risks for investors in Asia’s third-largest economy. Subramanian Swamy, a member of Modi’s ruling Bharatiya Janata Party and a rival to Finance Minister Arun Jaitley, wrote a letter to the prime minister earlier this week calling for Rajan to either be fired or dismissed when his term ends in September.”In a world of endless QE, liquidity abundance and resulting investor confidence, India’s massive financing needs appear manageable. But QE has not worked as global policymakers anticipated. The BOJ has printed a Trillion, yet a 25% decline from last year’s highs has Japanese stocks benefiting little from unprecedented money printing. The situation in Europe is similar: European stock markets have little to show from the ECB’s Trillion of new “money.” And in both cases, consumer price inflation has proven impervious to an additional Trillion. In the past, the inflationists would invariably claim that monetary stimulus was not working as prescribed only because it was not being used in sufficient quantities. These days, only the fanatics refuse to accept that QE is not very effective – while coming with huge risks. And after betting the ranch on QE, there is today no consensus as to what to try next. May 20 – Reuters (Leika Kihara and Stanley White): “A rift on fiscal policy and currencies has set the stage for G7 advanced economies to agree on a ‘go-your-own-way’ response to address risks hindering global economic growth at their finance leaders' gathering that kicked off on Friday. Japan backed away from its previous calls for coordinated fiscal action to jump-start global growth with Finance Minister Taro Aso saying on Friday that while some G7 countries can deploy more fiscal stimulus, others cannot ‘due to their own situations.’ That chimed with Washington's stance made clear by a senior U.S. Treasury official that there was no ‘one-size-fits-all’ for the right mix of monetary, fiscal and structural policies.”Friday from the Wall Street Journal: “U.S. and Japan Heading for Standoff on Yen Devaluation,” and from Reuters: “Japan, U.S. remain at loggerheads over yen policy.” What a far cry from Dr. Bernanke’s “enrich-thy-neighbor” (as opposed to “beggar-thy-neighbor”) that he previously used to describe the Bank of Japan’s aggressive monetary stimulus and devaluation. The theory and experiment just didn’t play out as expected. Proponents, however, persist with the “things are still a lot better than they would have been without QE.” The much more important issue is how in the world are central banks to now extricate themselves from deeply flawed policies that have so destabilized global finance? Are this week’s rising Treasury yields partially explained by renewed fears of EM central bank liquidations?I believe historians (and many others) will look back at this period and struggle to comprehend how such Unambiguous Signals were Disregarded: Declining equities and commodities prices in the face of massive QE; out-of-control debt growth in China; EM financial and economic travails; competitive devaluations and wild currency market volatility; unfathomable global bond yields; sinking global bank stocks; hedge fund struggles in the face of aggressive monetary stimulus; U.S. political upheaval (deep divisions, Trump, Bernie, etc.); rising geopolitical pressure across the globe; and tensions between the U.S. and China heading to the boiling point. The VIX jumped to 17.6 Thursday afternoon, near a two-month high.

Is America capable of preventing Donald Trump from coming to power? Although the candidate is himself no fascist, his campaign has certainly shown plenty of parallels.

There have been moments in this election campaign that have brought back dark memories. In Mississippi, Florida and elsewhere, presumed Republican presidential candidate Donald Trump asked his supporters to raise their right hands and pledge their allegiance to his cause: "I do solemnly swear that I, no matter how I feel, no matter what the conditions, if there's hurricanes or whatever. Will vote on or before the 12th for Donald J. Trump for President." Tens of thousands raised their right arms and repeated the oath after him. The America media drew comparisons to Adolf Hitler.Has the most powerful nation on earth become vulnerable to an authoritarian, nationalist leader? And what does this wave of nationalism mean for expected Democratic presidential nominee Hillary Clinton and the rest of America?Trump's rise is the consequence of an ongoing crisis in the United States over the last two decades -- one American elites long ignored. They had no answers for Americans who live in states like Kentucky or Oregon, and who no longer understand what is happening on Wall Street, in the White House and the rest of the country. This election campaign has now brought the crisis to the fore. This is evident in Trump's victories, just as it is in the passionate support for Clinton's rival, Bernie Sanders, who has made the term "socialism" acceptable in the country once again.America feels like an exhausted democracy, even though, at first glance, the country isn't in bad shape economically. The economy has recovered during Barack Obama's presidency, growing by 2.4 percent in 2015. Unemployment has declined to 5 percent. The United States is one of richest countries in the world. It is the second largest market for German luxury carmaker Porsche, following only China.But this growing wealth is largely restricted to a group of multimillionaires and billionaires whose lives have become disconnected from those of the rest of the country. Since 1999, an average family's annual income has declined by $5,000 (4,420) while its assets have shrunk by a third. Two-thirds of all households are in debt, often deeply so. This breakdown into a nation of a few winners and many losers has done something to the country's mentality.According to the New York Times, the number of people who still believe in the American Dream has fallen to the lowest level in 20 years. More than half of all Americans under 25 no longer believe that capitalism is the best of all economic systems. The strive for wealth and social advancement, forces that Alexis de Tocqueville once described as the country's binding elements, are no longer strong enough to hold its society together. The problem is further complicated by the competition between the shrinking white majority and the growing black and Hispanic minorities for jobs and wealth.

Symptoms of 1930s Europe

At "no other time was there as much pessimism -- valid pessimism, moreover -- about America's future as there is today," conservative columnist Dennis Prager recently wrote on his blog. And journalist Andrew Sullivan, writing in New York magazine, warned that late-stage capitalism is creating "a righteous, revolutionary anger that late-stage democracy has precious little ability to moderate or constrain." The country is exhibiting symptoms of 1930s Europe.Trump, who has been flirting with a run for the presidency for years, has developed a perfidious instinct for this moment. He courts the people on the losing end of modernization, or, to be more precise, those who fear becoming one of them. Contrary to common belief, Trump's supporters do not consist primarily of blue-collar workers and the unemployed. Exit polls have shown that his voters have an average annual household income of $72,000, which is higher than the average salaries of Sanders and Clinton supporters. Support for Trump highlights middle-class Americans' fear of social and economic decline.The core of Trump's policy is to react to this fear by establishing an identity through marginalization and isolation. This is evident in his campaign promises to build a wall along the Mexican border and to deny Muslims entry into the United States. "The use of ethnic stereotypes and exploitation of fear of foreigners is directly out of the fascist's recipe book," fascism expert Robert Paxton recently told the online magazine Slate. According to Paxton, Trump's campaign slogan, "Make America Great Again," sounds exactly like the slogans of fascist movements. In comments recently given to the Washington Post, Paxton added that "a sense of victimhood is absolutely essential" to the rise of fascism, "and I think that's very strong in America today," particularly among the white middle class.Trump, like Europe's right-wing populists, is betting on aggressive nationalism as a response to this sense of victimhood and the complexities of globalization. At his campaign rallies, the seats shake when tens of thousands of fans collectively bellow their response to the question of who will pay for the border wall: "Mexico!" Trump's supporters cheer when he threatens to punch protestors in the face. And they seem to have been waiting for someone to finally promise to deport -- with force, if necessary --the 11 million illegal immigrants from Central and South America. By breaking social taboos, Trump's appearances resemble the "rallies of fascist leaders who pantomimed the wishes of their followers and let them fill in the text," Jeffrey Herf, a political science professor at the University of Maryland and expert on Nazi Germany, recently wrote in the American Interest magazine.This aggressive nationalism is paired with an absurd authoritarianism. Indeed, there is something operatic about Trump promising his voters that after he wins the election, his first official act will be to call the CEO of Ford and force him to move his auto plants from Mexico back to the United States within 48 hours -- not to mention his vow to force Apple to stop making iPhones in China. But Trump's words have made an impact.The further this campaign progresses, the greater the extent to which Trump modifies his domestic agenda. He deliberately targets those at the losing end of society, people threatened by social decline. He promises not to touch social security, and he guarantees that no one will starve in the streets. With these promises, he is opposing his own party, where the term social welfare state is seen as being synonymous with communism. He promises a strong government that guarantees its citizens jobs and protection. He projects both a nationalist and social message.

Fascist Characteristics

Fascism expert Paxton compared Trump's rallies with those of Italian fascist leader Benito Mussolini and arrived at a remarkable conclusion. According to Paxton, Trump not only resembles Mussolini in the way he sticks out his lower jaw, but also in his speech. His short, blustering sentences sound similar to those used by "Il Duce" in his speeches, Paxton writes. Like Mussolini, Trump is masterful at handling large crowds. And even in his contempt for the establishment, he resembles the leaders of revolutionary movements in the Europe of the 1920s and 1930s. Trump isn't leading a party but a movement, and his supporters are pledging their oath of allegiance to the candidate, not the Republicans.History isn't repeating itself. There are no signs that Trump would be prepared to invade other countries or murder millions of people. Nevertheless, some of his key demands -- forceful deportations, blanket entry bans for Muslims and the refusal to rule out torture -- have fascist characteristics. But Trump is no fascist -- he doesn't, after all, want to abolish the Constitution. Yet he is playing with totalitarian elements in a dangerous way.American democracy has never been "so ripe for tyranny" as it is today, warns Andrew Sullivan, comparing the situation in the United States with that of the Weimar Republic. Is Sullivan exaggerating? Perhaps. But there are no guaranteed "happy endings" in politics. Democracy has to be defended.It is up to America's elite and its civil society to react to the challenge. Clinton, the Democrats' likely candidate, is only partly suited for this task. As someone who has been involved in politics for decades, she represents the establishment, and politics has made her a multimillionaire.America needs a major social debate over the causes of the rage, the unfair distribution of wealth and the excesses of capitalism. It was once the Republicans who, under Abraham Lincoln, decided to abolish slavery, thereby laying the foundation for the modern American age. The party will be challenged once again at its convention in July. Before it nominates its candidate, it could exclude all forms of racism and hate from its platform, and Trump would then have to decide whether he could run for president on this basis. On the other hand, this summer could also mark the end of a de facto two-party system, in which Republicans and Democrats no longer represent the interests of many people. Why not field a third or fourth candidate?Trump's answer to the crisis is the exclusion of others. But the correct answer should be inclusion -- not just of Trump's supporters, but also that of society's weakest. There's much more at stake in the United States right now than the contest between two candidates. This is a question of tolerance, pluralism and the very future of a deeply drained democracy. Holger Stark is DER SPIEGEL's Washington bureau chief.Translated from the German by Christopher Sultan

A pro-democracy demonstration in Hong Kong on Wednesday during a visit by a high-ranking Chinese official, Zhang Dejiang.Credit Dale De La Rey/Agence France-Presse — Getty Images HONG KONG — The heart of this global financial hub resembled an armed camp on Wednesday as thousands of police officers deployed around a hotel and convention center where a senior Chinese official was visiting.

For many in Hong Kong, the show of force only increased their fears that the city’s civil liberties and autonomy are under assault by the government in Beijing.

Across the Taiwan Strait, final preparations were underway for the inauguration on Friday of Tsai Ing-wen, Taiwan’s first female president. She was swept into power in part by young voters anxious about what they see as Beijing’s rising influence over the island. Ms. Tsai is expected to have a far more cautious attitude toward promoting Chinese trade and investment than her predecessor.

It is a humbling week for China. The world’s second-biggest economy after the United States, it is richer and stronger than ever, and its financial clout is being felt the world over. But Beijing is finding it exceedingly difficult to win hearts and minds in its own backyard, among the more than 30 million Chinese-speaking people of Taiwan and Hong Kong.

China is searching for a new approach toward both Hong Kong and Taiwan, but it has yet to find one that is different from the policies it has used before — hard-line political tactics that provoke resentment, and pragmatic appeals to economic interests that fall short in societies where the benefits of trade with the mainland are unevenly distributed.

“There are more centrifugal forces, and it’s hard for Beijing to deal with these forces,” said Jean-Pierre Cabestan, a professor of government and international studies at Hong Kong Baptist University. “I think it is a clash between two political cultures: authoritarian in China and liberal in Hong Kong and Taiwan. Hong Kong is very much on the bridge, resisting the authoritarian political culture in China.”

In important ways, the visiting Chinese official in Hong Kong, Zhang Dejiang, is representative of that culture. As chairman of China’s legislature, the National People’s Congress, he presided over the August 2014 decision to set strict rules on vetting candidates for Hong Kong’s top official post, the chief executive, leading to the huge protests that year that captured the world’s attention. He is the highest-ranking member of the Chinese government to visit the city since then.

But Mr. Zhang, 69, is also remembered in Hong Kong as the Communist Party chief of neighboring Guangdong Province in 2003, when the outbreak of severe acute respiratory syndrome, or SARS, swept over China. He was criticized for the slow response to the outbreak and for official efforts to keep the news of the deadly virus out of the media. The disease spread to Hong Kong, killing 299 people.

Such attitudes — a fear of democracy and heavy-handed control of the news media — are at odds with the increasingly well-educated populations in Hong Kong, a former British colony where civil liberties like freedom of speech and freedom of assembly are guaranteed, and Taiwan, a democracy for the past two decades.

Those concerns erupted late last year, when five Hong Kong booksellers disappeared, showing up later in Chinese custody in Guangdong. One publisher, Lee Bo, was plucked from the streets of Hong Kong, a violation of the “one country, two systems” principle that safeguards the city’s autonomy until 2047, the 50th anniversary of its return to Chinese sovereignty.

“That act is like driving a truck through ‘one country, two systems,’ ” Emily Lau, head of the Democratic Party in Hong Kong’s legislature, said in a telephone interview. “Hong Kong is going through very dark times.”

Ms. Lau and several other pro-democracy lawmakers met with Mr. Zhang at a reception on Wednesday evening, telling him that the city’s chief executive, Leung Chun-ying, should be dismissed. Mr. Leung was standing next to Mr. Zhang at the time, Ms. Lau said.

Mr. Lau and her colleagues also urged Mr. Zhang to revisit the issue of democratic elections for the chief executive post. They argued that opening up the position to a genuine contest, rather than allowing only a narrow slate of Beijing-approved candidates, would help to damp growing enthusiasm in Hong Kong for self-determination, and even independence, she said by telephone.

A rehearsal on Wednesday for the presidential inauguration of Tsai Ing-wen in Taipei, Taiwan. Ms. Tsai is expected to have a far more cautious attitude toward promoting Chinese trade and investment than her predecessor.Credit Sam Yeh/Agence France-Presse — Getty Images

“People are very, very frustrated, and that’s why some, including young people, are looking for a way out, including independence,” Ms. Lau told Mr. Zhang. She said he responded that Beijing was satisfied with the performance of the Hong Kong government and that people had differing points of view.

“I think he got the message loud and clear,” she said.

Earlier in the day, Mr. Zhang spoke at a conference in Hong Kong promoting China’s plan to forge better infrastructure links with Asia and Europe, called “One Belt, One Road.”

Concern that some of the newly radicalized groups in Hong Kong might try to disrupt Mr. Zhang’s visit — the first by a member of the elite Politburo Standing Committee since 2012 — led to extraordinary security measures.

At least 6,000 police officers were enlisted to provide security around the city’s convention center. Streets were sealed off, and city employees even glued down some paving bricks on sidewalks, after rioters in February threw the bricks at police officers.

“He must feel fearful and guilty, so he needs such high security and fears any contact with the people,” said Raphael Wong, vice chairman of the pro-democracy League of Social Democrats, whose members had assembled in one of the designated protest zones blocks away from where Mr. Zhang was staying. “He simply couldn’t tolerate any dissent against the Communist Party.”

The Communist Party also would not tolerate Taiwan’s declaring independence, and has repeatedly vowed to take the island by force should that happen. A Pentagon report released last week stated that China is steadily building up its forces across the Taiwan Strait.

On Wednesday, two days before Ms. Tsai was set to take office, the Chinese Ministry of Defense announced it had been conducting military exercises across from Taiwan involving air, sea and land forces, though it added that the exercises were “not directed at any specific target.”

In recent months, China has taken several other steps that put pressure on Taiwan’s incoming government. It extradited Taiwanese suspects in alleged telephone fraud scams from Kenya and Malaysia, leading to protests by Taiwanese diplomats. It also resumed diplomatic relations with Gambia, which had previously recognized Taiwan.

Beijing also appears to be stepping up pressure on international organizations not to accept Taiwan as a separate member.

Although Ms. Tsai has promised to maintain the status quo with China, many in her Democratic Progressive Party, which captured the presidency in January elections and, for the first time, control of the legislature, support Independence.

Under the current president, Ma Ying-jeou of the Kuomintang, or Nationalist Party, cross-strait economic ties have flourished. But China’s intentions worried many in Taiwan, who saw the closer relations as tools to advance Beijing’s goal of political control.

In early 2014, demonstrators, overwhelmingly young people, occupied Taiwan’s legislature for 23 days to block the passage of a cross-strait trade agreement. Several of them then traveled to Hong Kong, speaking out in support of Taiwan independence and a democratic Hong Kong in July 2014, at a demonstration in the heart of the city that served as a preview of the protests that autumn.

Ultimately, in both Hong Kong and Taiwan, the generations now moving into positions of responsibility increasingly view themselves as separate from China, and that rise of identity politics “could pose grave political challenges to Beijing,” said Zhang Baohui, a professor of political science at Lingnan University in Hong Kong.

“I feel like Hong Kong is like Taiwan more than 20 years ago, before we had free elections,” said Sung Chung-hsing, 43, a lawyer in the island’s capital, Taipei. “The young people in Hong Kong have realized the importance of freedom and elections. I hope they can raise their voices and let the mainland government know their feelings.”

The presumptive GOP nominee is pivoting on key issues and toning down the Yellen bashing.

By Greg Valliere

In one of the most significant developments of the campaign, Donald Trump has dropped his Wall Street bashing and has pivoted on key issues. He obviously has gotten an earful, and now promises to dismantle Dodd-Frank, and has dramatically toned down his criticism of the Federal Reserve.

The irony is that Hillary Clinton was supposed to pivot by mid-May, but her increasingly ugly fight with Bernie Sanders has boxed her in – maybe for weeks to come. Trump has the luxury of pivoting, especially as he ramps up fundraising appeals to conservative fat cats. And they’re telling him – ease up on Wall Street.

We still think that the markets have to worry about the uncertainty factor – Trump shifts positions daily – but Wall Street’s anxiety over him may begin to recede. For months, we have listed four economic worries that Trump would bring – but suddenly three of those worries have lessened:

1. Trade war with China. Trump has not relented on this one, and the markets have to worry about the prospect of a major rift between the world’s two biggest economies.

2. A nasty spat with Yellen. This looks far less likely; Trump almost surely has been told to tone it down by his Wall Street friends. Will he align with anti-Fed zealots who want to curb the central bank’s power? Maybe not.

ABOUT LAST NIGHT: Hillary Clinton’s delegate lead hardly budged, but the take-away from last night was Bernie Sanders’ absurd – almost delusional – claim that he can arrive in Philadelphia on July 25 with enough delegates to win the nomination. Bernie, Bernie – it cannot happen !! All he’s doing is stoking resentment among young people against the Democratic Party (which Sanders never really joined). Like we wrote yesterday, he’s inflicting enormous damage on Clinton.

RATE HIKE ALERT: After yesterday’s inflation uptick and comments from Fed officials that a rate hike is on the table, starting in June, we reiterate: the best bet is for a fed funds increase is July, with the Fed then making it clear that another move might not come until year-end. Janet Yellen has work to do – she needs to prepare the markets for this – and we think she will set the table in a major speech on June 6.

A refugee child at the Greek-Macedonian border near the village of Idomeni

The refugee debate creates the impression of unprecedented mass migration. That image is completely incorrect. The real question, when we look at migration globally, is why there is so little of it.

Take a tape measure. Unroll the tape to about two meters (six feet) and place one end against a wall.The distance between you and the wall corresponds to the world population of about 7.3 billion people. The number of people worldwide who left their native countries in the last five years -- in other words, migrated -- takes up about one centimeter (three-eighths of an inch) of the tape measure. That number amounted to 36.5 million, or 0.5 percent of the world's population. All others, or 99.5 percent of the global population, are non-migrants, or people who were living in the same country in 2015 as in 2010. They represent the other 199 centimeters on the tape measure.This is the sort of thing you learn when you pay a visit to Guy J. Abel, the man who can load all the world's migrants onto his computer and draw colorful circles around them. The 35-year-old Englishman is a social statistician and population researcher at the Wittgenstein Center for Demography in Vienna. Abel has developed a model to estimate and depict the actual dynamics of global migration. An examination of the results quickly shows that we have a lot of incorrect images in our heads."I always felt that the traditional methods of estimating global migration were rather inadequate," Abel says.The institute is part of the new Vienna University of Economics and Business campus, next to the Vienna convention center, a group of shiny, oblique-angled new buildings that look like something architect Zaha Hadid might have designed for a colony on Mars. The Wittgenstein Center, on the second floor of building D5, is considered one of the most important research centers of its kind. Its researchers address existential questions such as these: Will there be too many people on the planet soon? (No.) Can the rich world survive the aging of society? (Yes.) Is Western Europe doomed because of its low birth rates? (No.)Guy Abel pulls up a colored globe on his screen, the one shown below. "This is an overview of all migration movements in the last five years," he says.But when viewing this image, says Abel, one shouldn't make the mistake of thinking that the entire world is on the move, as the chart suggests. It merely depicts the movements of the 0.5 percent of the world population that became international migrants in the last five years. All others, the 99.5 percent, have not moved at all. In other words, the viewer must condense the colorful ball of wool and stuff it into the first centimeter of his tape measure. That's because staying put is the standard, while migration is the great exception.Now we zoom in. We can see all migration within the last five years, in and between world regions, as defined by the United Nations: Europe, Africa, North America, South America, the Middle East, East Asia, South Asia, Central Asia and Oceania. The share of the global volume of migration that affects Europe is only a fraction of the whole.This means that even if we consider the movements recently triggered by the war in Syria, the entire European and German "refugee crisis," when viewed from a global perspective, takes place within the first few millimeters of the tape measure.

A Fraction of a Very Small Fraction

Just to be clear, a fraction of a small fraction of a very small fraction can still be a big number. We are not trying to downplay anything here. There are huge challenges faced by target countries of international migration like the United States, South Sudan, Kenya, the United Arab Emirates, Lebanon, Jordan, Turkey and, to a lesser extent, Germany. And, in particular, we are not downplaying the plight of refugees and economic migrants, who don't care how many or how few of them there are, because each of them is seeking a better life. There are always people behind the numbers, percentages and tenths of percentages -- lots of people.Nevertheless, it is helpful to take a look at the globe as a whole, especially now, with immigrants to Germany and Europe being brought to a forced halt in Turkey before they can find alternative routes.Those who are unfamiliar with the true scale may perhaps see "waves" of immigrants rolling in or an "onslaught" about to take place. They see entire nations unpacking their things to set up house in Europe and Germany, provided they survive the journey.This is why we want to address a few simple questions. Just how many people are actually on the move? And how many are going from where to where? Is it true that the numbers are constantly growing? Or are they in fact declining? Who actually counts the migrants? Who is considered a migrant and who a refugee? And are the numbers we constantly read and hear about figures that actually make sense?"The truth," says Guy Abel, "is that the global migration dynamic has remained constant at a low level for more than half a century." Did he say "low level?"

Turning Up the Volume

The basic problem, Abel explains, is that all migration figures come from the United Nations, which measures migration by combining the numbers of migrants and refugees from all countries. The UN defines migrants as "persons living in a country other than where they were born." The data are derived from individual countries' censuses and refugee registries.In a recent press release, the UN announced the latest total number as follows: "The number of international migrants -- reached 244 million in 2015 for the world as a whole, an increase of 71 million, or 41 percent, compared to 2000."244,000,000: What a huge number! 41 percent -- an increase of almost half!Well. First, let's take a look at the 41 percent increase. It relates to absolute numbers, which are not reasonable benchmarks here. In 2000, the UN counted 173 million migrants. That was 2.8 percent of the global population of 6.1 billion at the time. Since then, the world population has grown to 7.3 billion, so that the 244 million migrants in 2015 make up 3.3 percent of that total.So why doesn't the UN communicate the information as follows: "Since the year 2000, the share of migrants in the world population grew by 0.5 percentage points?" Because it sounds less concerning?Here's the situation. The UN doesn't receive enough money. Its World Food Program, for example, is radically underfunded, as are its aid campaigns for Syria. Coming from this position of need, the UN always turns up the volume when announcing its figures. Dependent as it is on money from its members to relieve its distress, the UN underpins its appeals with dramatic terms like "all-time high," "new maximum" and "record low." By doing so, it contributes significantly to the imbalance in the migration debate. But the bigger problem lies in the number itself, 244 million. Why?"The figure has several serious weaknesses," says Abel, and yet it is spread around the globe by hundreds of media organizations, press agencies, NGOs, politicians and even academics. Numbers like these, or their international equivalents, from which they are derived, serve as the basis for debates, studies and laws. Why? Because there is no more credible source than the UN. This widespread perception leads to phrases like these: "The world has 41 percent more migrants now than in 2000, UN reports" (Toronto Star). "UN: Number of global migrants soars to 244 million" (Newsweek). Or, conversely and especially distorting, on the website of Swiss television: "Fewer and fewer people are living in their native countries."The number, 244 million, isn't incorrect. It just says very little about all the things you would want to know when you think about migration.For one thing, according to the UN's definition, the 244 million correspond to the total aggregated migrant stock in the world. This means that anyone who ever left their country of birth and is still alive is part of this number. It includes the man who runs the nearest kebab shop, who has been in Germany for 20 years. It includes the Indian professor of nuclear physics, who took a job at a German university in Göttingen in the 1980s. It includes the Swedish designer who has lived in Berlin since the mid-1990s. It includes Bayern Munich manager Pep Guardiola. The Klitschko boxing champions. And many other examples. It even includes the author of this article, who was born in Switzerland.Are these the people you imagine when you think of migration?According to Abel, "244 million is a number that says nothing about how many people migrated from which country to which country, and when."

A Eurocentric Worldview

Of course, the situation is further complicated by mismatched data sets. Most countries do not compile detailed migration statistics. The UN figures include many assumptions and estimates, because the survey methods of the 200 countries included are highly variable -- and differ greatly in terms of reliability. Still, they are the best numbers we have.The figures and tables dance across Abel's screen. His model is not easy to understand. Here's the abbreviated version: Whereas the UN measures migrant stocks, Abel estimates migrant flows over certain periods of time. A flow corresponds to the migration of at least one person to another country in a five-year time period. In other words, Abel uses UN and World Bank figures to detect changes in the total migrant stocks of about 200 countries every five years since 1960. Using algorithms, he calculates the minimum amount of migrant flows that must have taken place between all of these countries every five years to reflect the changes in migrant stocks.Got it?Perhaps a soccer analogy will help. Let's assume we know how many foreign players were playing for all German Bundesliga football clubs in 2010 and 2015, but we don't know how many switched from which team to which team. Guy Abel can figure it out. Right?"It's roughly like that," says Abel. It's complicated, he adds, "but it works."The co-author of his study, published in the American journal Science, is German population geographer Nikola Sander, 36, who also conducts research at the Wittgenstein Center. She and her colleague Ramon Bauer, 40, developed the innovative circular visualizations depicted in this article. The numbers for 2010 to 2015, on which the images are based, have only been available for a few weeks now. The UN provides the corresponding global data sets only once every five years."The general perception of migration suffers from a Eurocentric worldview. People believe that the entire world wants to go to Europe. But when you look at our graphics, you quickly realize that this isn't true."In light of the European "refugee crisis," there is one important caveat: The UN data upon which Abel's calculations are based are collected in the middle of the year. In other words, the image only depicts migrant flows until July 1, 2015. Official migration statistics through the end of 2015 are not available yet, including figures for Germany.Would the circle look significantly different if the many Syrian refugees who came to Europe and Germany since the middle of last year were taken into account?Abel looks at his computer screen. "No," he says, pointing with the tip of a pen to the thin arrow that leads from the Middle East to Europe, which also includes the Syrian refugees. "It would be about twice as wide. That's all."

Overall Migration in Decline

What else can we learn from these circles?The largest global migrant flows take place within individual world regions, not across continents. This is evidenced by the thickest arrows in the chart, which point from Africa to Africa, from the Middle East to the Middle East, and from East Asia to East Asia. The arrows represent the migrations of hundreds of thousands of people from places like India to Dubai or from Syria to Lebanon.- Significantly more Europeans migrate within Europe than Africans to Europe.- A much larger number of people migrate within the Middle East than from the Middle East to Europe.- The largest transcontinental flow continues to move from South to North America, although it has decreased considerably compared to the period from 2005 to 2010.- North America and Europe remain the most important target regions for international migration, although North America has a significantly smaller out-migration than Europe.- Europe's share of the total migration volume has declined.- Migration paths do not lead primarily from very poor to very rich countries, but rather adhere to a graduated model. "People move to countries where the economy is somewhat stronger than in their native country," says Sander. She means from Bangladesh to India or from Zimbabwe to South Africa, for example.- East and Southeast Asia are developing from typical source regions into target regions of international migration.- What has changed in the long retrospective view is the general direction of migration: from North-South to South-North and now, increasingly, to South-South. In earlier centuries, it was the Europeans who emigrated or colonized other parts of the world, which is just another form of migration.- But the most surprising result of Abel's calculations is that overall global migration has been on the decline in the last five years.On the decline?"Significantly on the decline," says Abel. The number of migrating migrants between 2010 and 2015 (36.5 million) is more than 8 million fewer than in the previous five-year period (45 million). The global migration rate reached an historic peak between 1990 and 1995, a time when the Iron Curtain had fallen, Afghanistan had descended into civil war and there was genocide in Rwanda. The 0.5 percent figure for the last five years is the smallest value since 1960.Which declining flows are behind this decrease, given that Europe is supposedly being "overrun" at the moment? They are simply processes that are much bigger than what we now see at Europe's doorstep. Dubai, for instance, has lost much of its appeal, and migration from India, Bangladesh and Pakistan to the economically weakening emirates has shrunk considerably. The same applies to migration to Qatar. In the last five years, migration from East Asia to North America has declined by more than half, from 3.4 to 1.6 million. Even Mexicans, now finding more jobs at home, are no longer as likely to migrate to the United States as they were before 2010. The Spanish economic crisis led to a dramatic decline in labor migration from Latin America and countries like Morocco and Romania: from 2.3 million to 120,000. Migration to and within Europe also declined significantly between the 2005-2010 and 2010-2015 periods, from 11 million to 7 million (although the difference would be less large if the available figures continued until the present).If we look back further, it becomes apparent that the absolute number of migrant flows has grown continuously since 1960 (with the exception of the last five years). However, the share of migrants in the world population has been virtually constant for more than half a century, consistently hovering around the 0.6 percent mark every five years. "There appears to be a historic rule of thumb," says Abel, "which is that for every five-year period, six out of 1,000 people are on the move." This stability is also apparent even if one does not count those who are currently migrating, but rather all people who have been living outside their native country for any period of time, as the UN does. In that case, migrants have made up about 3 percent of the world population since 1960. This is why people who study migration are not as interested in the problem of growing migration numbers. Instead, they are more likely to address the question of why there is so little migration.

Tossing Refugees and Migrants into the Same Pot

"May I point out another problem?" Nikola Sander asks amiably. In her office, only a few doors down from Abel's office in the Wittgenstein Center, there is, of course, a giant map of the world hanging on the wall above her desk. "Unfortunately," says Sander, "the media hardly makes the distinction between refugees and migrants." The UN is partly to blame for that too, she adds.What distinguishes a refugee from a migrant? One of them migrates voluntarily, while the other is forced to do so. However, the UN migration figures toss both categories into the same pot. Some 15 million of the 244 million UN migrants are refugees. Another problematic number is also quoted very often: 60 million. The UN High Commissioner for Refugees (UNHCR) usually refers to 60 million "persons of concern," but this is usually simplified in the debate to mean "60 million refugees.""This number also needs to be scrutinized more closely," says Sander. About 35 of these 60 million people, or more than half, are internally displaced persons, or refugees in their country: homeless Syrians in Syria, uprooted Afghans in Afghanistan. Their plight is usually no less severe than that of internationally migrating refugees - often it is even more serious. But because they have not crossed a national border, they are not considered refugees under the Geneva Convention. They are the kinds of internally displaced persons Germany's conservative Christian Social Union (CSU), the right-wing populist Alternative for Germany party and Hungarian Prime Minister Viktor Orbán like, because they remain in their native countries -- often enough to die there. But this doesn't prevent the agitators from exploiting their large numbers, which don't even affect them, for political gain.The number of refugees in a narrower sense -- namely those who have left their country, fall under the provisions of the Geneva Convention and are entitled to protection as refugees -- is significantly lower. As of mid-2015 (more recent figures do not exist), the UNHCR estimated their number at 15 million worldwide.Unfortunately, the same thing applies to refugees as to migration as a whole: The UN and aid organizations use threatening language when they announce the relevant figures. For instance, according to an announcement by the UNHCR, the number of displaced person is now at "a level not previously seen in the post-World War II era." This statement was gratefully snapped up by the media around the globe. The website of the Süddeutsche Zeitung newspaper, for example, reads: "60 million people are fleeing worldwide, more than after World War II. Is this tragedy overwhelming mankind?"

A Vicious Circle

The relentlessly lurid expression "more than after World War II," inspired by the UNHCR, already makes no sense given that the world's population was only about 2 billion after World War II. If an estimated 60 million people were refugees in Europe alone at the time, it was already 3 percent of the world population -- almost four times as much as today. Why doesn't the UNHCR write: "The share of refugees in the world population today is less than a quarter of what it was in the period after World War II?" Isn't 60 million enough?It's a vicious circle. The UN needs money and is constantly sounding the alarm. But its dramatizations create more fear than a willingness to help in the individual countries and the public. They also lead the paradoxical situation that actors on the left and right sides of the political spectrum use the same blustering rhetoric to talk about migration. Aid organizations and the left are fueling the fire because they want to inspire pity. Right-wing populists are sounding the same tune because they want to generate fear. It's just the truth that is hard to sell.The truth is it's bad. It's been bad for a long time. It's even been far worse before than it is today. But by no means is it "overwhelming mankind" -- and certainly not Europe. The problem could be overcome, if only the will to do so existed.Translated from the German by Christopher Sultan

LOS ANGELES – Saudi Arabia has captured the world’s attention with the announcement of an ambitious agenda, called Vision 2030, aimed at overhauling the structure of its economy.

The plan would reduce historical high dependence on oil by transforming how the Kingdom generates income, as well as how it spends and manages its vast resources. It is supported by detailed action plans, the initial implementation of which has already involved headline-grabbing institutional changes in a country long known for caution and gradualism.

While the immediate catalyst for economic restructuring is the impact of the sharp fall in international oil prices, the rationale for these reforms has been evident for much longer. With oil sales generating the bulk of government revenues, and with the public sector being the predominant employer, Saudi officials have long worried that the Kingdom’s lack of economic diversity could place at risk its long-term financial security.

The more than halving of oil prices in the last 18 months has been accompanied by a major change in how the oil market functions. With growth in non-traditional sources of energy – particularly the “shale revolution,” which drove a near-doubling in US production, to almost ten million barrels per day, in just four years – the Saudi-led OPEC oil cartel has less influence on market prices. In addition, certain members of OPEC, again led by Saudi Arabia, are now less willing to try to moderate fluctuations in the price of oil, as they correctly recognize that “swing producers” risk durable losses in market share.

That’s why Vision 2030 is so important. Seeking to regain better control over its economic and financial destiny, the Kingdom has designed an ambitious economic restructuring plan, spearheaded by its energetic new deputy crown prince, Mohammed bin Salman Al Saud. In simplified terms, Vision 2030 focuses on three major areas, together with efforts to protect the most vulnerable segments of the population.

First, the plan seeks to enhance the generation of non-oil revenues, by raising fees and tariffs on public services, gradually expanding the tax base (including through the introduction of a value added tax), and raising more income from a growing number of visitors to the Kingdom.

Second, the authorities want to reduce spending by lowering subsidies, rationalizing the country’s massive public investment program, and diverting spending on arms away from foreign purchases.

Third, the Kingdom seeks to diversify its national wealth and, in the process, increase current investment income. For example, the plan would raise funds via the IPO of a small part (up to 5%) of Saudi-Aramco, the giant oil conglomerate, and invest the proceeds in a broader range of assets around the world.

This bold economic vision is not without risks. Economic transitions are inherently tricky, especially one of this scale and scope. Early successes are often needed to solidify the overwhelming buy-in of key constituencies, particularly those that naturally may be resistant to change at first (especially change that eliminates some of the traditional financial entitlements in moving from a familiar, albeit less secure, present toward what is now an unfamiliar future).

The action plans underpinning the implementation of Vision 2030 inevitably involve progressing on multiple fronts simultaneously and in a carefully coordinated and monitored fashion. Requiring invigorated administrative and operational resources, it comes at a time when the Kingdom is not only dealing with lower oil earnings and drawing down its large reserves, but also is increasingly asserting its regional role, including in Syria and Yemen.

Against this background, it is encouraging that the announcement of Vision 2030 has been followed rapidly by the implementation of some initial and notable steps. Sustaining this momentum in a manner that maintains consistent communication with key domestic stakeholders will likely prove critical in determining the plan’s success. How the Saudis proceed on this important economic restructuring is being closely watched by the other five members of the Gulf Cooperation Council – and by many other countries as well.

The attention attracted by Vision 2030 is not surprising. The plan, after all, is about a lot more than fundamental economic reforms. If Saudi Arabia succeeds in transforming its economy, including reforming institutions and restructuring economic incentives, other countries that face similar challenges, in the region and beyond, will be inspired to follow suit.

If you know the other and know yourself, you need not fear the result of a hundred battles.

Sun Tzu

We are travelers on a cosmic journey, stardust, swirling and dancing in the eddies and whirlpools of infinity. Life is eternal. We have stopped for a moment to encounter each other, to meet, to love, to share.This is a precious moment. It is a little parenthesis in eternity.